THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

BLITZER: And to our viewers, you're in THE SITUATION ROOM.

Happening now, a grim forecast from the Centers for Disease Control & Prevention warning Americans to brace for death as swine flu spreads across the country. We're tracking hundreds of suspected new cases. And we'll meet one family with five members stricken.

Mexico taking drastic action right now to try to contain the spread of the virus, closing tens of thousands of public spaces. The country's ambassador to the United States standing by to join us live.

And a stunning defection on Capitol Hill -- Senator Arlen Specter of Pennsylvania leaving the Republican Party, joining the Democrats, putting them one step closer to a potentially unstoppable majority.

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

ANNOUNCER: This is CNN breaking news.

BLITZER: There's breaking news coming in about possible efforts to make a swine flu vaccine.

Our senior medical correspondent, Elizabeth Cohen, is joining us right now with more -- Elizabeth, what are you picking up?

ELIZABETH COHEN, CNN SENIOR MEDICAL CORRESPONDENT: Well, Wolf, all afternoon I've been on the phone with some of the nation's top vaccine researchers. What they're telling me is that last night they got a very interesting e-mail from the NIH that basically said get ready, we're going to be doing clinical trials at some point for a swine flu vaccine.

Now this is what Dr. David Besser, head of the CDC, had to say about vaccines today.

(BEGIN VIDEO CLIP)

DR. RICHARD BESSER, ACTING CDC DIRECTOR: Moving forward, though, into the future, a vaccine is something that we are looking at very intently. And as I've said before, we're growing up that seed stock of -- of virus so that if we decide to manufacture a vaccine, we're ready to do so.

(END VIDEO CLIP)

COHEN: When you talk about swine flu vaccine, officials are heading into some potentially tricky waters. Wolf, you might remember in 1976, they tried to massively vaccinate against swine flu only to halt it after just a few months because too many people were getting a horrible nerve disorder.

And what's interesting here is that this e-mail that the researchers got, they were told go into your freezer, find some old samples from blood of people who got that vaccine back in '76 -- so 33 years ago. One of the things, probably, that they're hoping to do is to avoid some of the complications that happened back in 1976 -- Wolf.

BLITZER: Elizabeth, so how long would it take, realistically, to come up with a vaccine?

COHEN: It would take months, Wolf. It is very difficult to come up with -- with vaccines. It can be -- they can be very slow growing. So it's going to take a while.

BLITZER: Elizabeth Cohen with the breaking news from Atlanta.

Thank you.

And there's much more happening right now with this story.

Let's go to CNN's Deborah Feyerick.

She's monitoring developments right here in New York -- Deb, lots going on. Lots of concern in New York City.

DEBORAH FEYERICK, CNN CORRESPONDENT: Well, lots of concern, Wolf. And, as a matter of fact, swine flu continues to spread. Cases being confirmed almost by the hour. But the number of people infected could be much, much higher, officials say, than the figures show.

(BEGIN VIDEOTAPE)

COHEN (voice-over): Health officials closed a second New York City school Tuesday after finding another cluster of possible swine flu infections a mile from the original outbreak at St. Francis Prep.

MAYOR MICHAEL BLOOMBERG (I), NEW YORK: Of the approximately 380 students at the school, 82 have currently called in sick, 12 of them with documented fever. And one of those has two siblings at St. Francis.

FEYERICK: Indeed, the number of swine flu cases originating from the prep school may be far greater than the 45 so far confirmed by the Centers for Disease Control.

BLOOMBERG: We now know of hundreds of students who were sick. Many family members of these students and staff are also sick. And we would normally expect to see one of every five family members of a person with flu get sick. And that is exactly what we're seeing with swine flu. FEYERICK: A third New York City school in Manhattan is under investigation and may also be closed pending test results. But no one in the U.S. has officially died from the new virus. Health officials believe it's just a matter of time.

BESSER: I fully expect that we will see deaths from this infection. They're seeing many deaths in Mexico. And we're -- we're trying to learn more about that and why the situation in Mexico is different from here.

FEYERICK: Some pharmacies in New York reported difficulty getting anti-flu medications.

BLOOMBERG: We have heard of spot shortages of Tamiflu.

FEYERICK: And though the outbreak is relatively new, health officials say they may never know exactly how many people have been infected.

BLOOMBERG: It may very well be that they had half a million cases of flu and it's so mild that most people didn't bother to report it and then a handful were very seriously sick and died.

(END VIDEO TAPE)

FEYERICK: Now, normally, one in five people do come down with seasonal flu, the regular flu. But health officials say that's really what they're seeing with swine flu. Officials are not testing everyone with mild symptoms, one, because labs would be overwhelmed; and, two, officials say it serves no real purpose since it doesn't change the course of treatment. Right now, they're focused on the very sick and, also, clusters, as well. Right now, 64 cases in five states, according to the CDC -- Wolf.

BLITZER: And, Deb, what's the latest on the hospitalizations?

FEYERICK: Well, what we know right now is that not -- most people have not been hospitalized. We know of two in New York. One was an adult, treated, released; also, a 2-year-old, who's currently hospitalized -- Wolf.

BLITZER: Deb Feyerick working the story here in New York for us.

Five members of one New York family have been stricken with swine flu -- five members.

Mary Snow is working this part of the story.

Wow!

MARY SNOW, CNN CORRESPONDENT: Yes. And this one family has seen just how quickly the swine flu can spread.

(BEGIN VIDEOTAPE)

SNOW (voice-over): Seventeen-year-old Frankie Civitano says he's feeling much better, two days after testing positive for swine flu. Civitano attends St. Francis Prep in Queens, where some students became ill after visiting Mexico. But Frankie did not go on the trip. He was exposed to kids coughing and sneezing.

FRANKIE CIVITANO, SWINE FLU VICTIM: I think I got it because I was in the nurse's office.

SNOW (on camera): You went to the nurse's office?

F. CIVITANO: Yes.

SNOW: And what happened?

F. CIVITANO: I was in there for like 45 minutes getting a cut cleaned up. And then I came back that night and I was sick.

SNOW (voice-over): Frankie first felt symptoms Thursday. By Monday, three of Frankie's siblings and a sister-in-law, from ages two to 24, got sick. His mother, Jacqueline Civitano, says it spread through her family like wildfire.

(on camera): What has this been like for you, dealing with this?

JACQUELINE CIVITANO, CHILDREN GOT SWINE FLU: It's -- it's a nightmare. You know, just worried about trying to get them past it and make sure that they're healthy. And, thankfully, that seems to be that they're coming through it OK.

SNOW (voice-over): But up until Sunday, she says no one was quarantined because they thought it was just a regular flu.

SNOW (voice-over): Not all family members suffered the same symptoms. And Jacqueline Civitano calls it extremely strange that with so many people traveling to Mexico, so many students at one school are sick.

J. CIVITANO: And to have hundreds of kids complaining of flu- type symptoms and this many kids testing positive, it's a little scary to -- you know, it's very disconcerting.

(END VIDEO TAPE)

SNOW: Now, everyone in the family is doing better. They're all now taking Tamiflu and they're staying out of school and work.

And when we spoke to them, Wolf, obviously, we stayed outside, kept at a distance. But they all seem to be getting better.

BLITZER: That's not an assignment I'm sure a lot of people like to get.

Did everybody in that family get sick?

SNOW: No. And that was one of the things -- three of the children did not get sick. And, obviously, the mother did not get sick. They were most concerned about a 10-year-old boy with diabetes. They were able to get him an anti-viral that was inhaled. But, no. Some of them were OK.

BLITZER: All right. Go wash your hands right now.

SNOW: I already did.

Let's check in with Jack Cafferty for The Cafferty File -- Jack.

CAFFERTY: Wolf, the ongoing recession is causing some changes in the way people deal with money. About one third of Americans say they've been spending less money in recent months. But more importantly, they say they plan to make this their new normal pattern in the future.

A new Gallup poll shows over 53 percent of those surveyed say they have been spending less. And 32 percent of those people say it will become the new norm for them. Thirty percent say they've been spending about the same amount of money. And surprisingly, 17 percent say they're spending more money.

Meanwhile, when it comes to savings, 36 percent they're saving more during these tough times; 31 percent saving about the same amount as before; and 32 percent say they're saving less -- in all likelihood because a lot of Americans are doing everything they can just to try to make ends meet and simply don't have any extra money to put into savings.

The poll also found nearly 60 percent of Americans say they enjoy saving money more, which is 22 points higher than those who say they enjoy spending money more. And that gap has increased since the last time the question was asked.

It's worth noting it's difficult to predict what people will actually do in the future. But these poll numbers could mean bad news for the country's retailers. Gallup suggests we could be seeing a new frugality settling in among many Americans.

So here's the question -- is spending less money a new reality for your family?

Go to CNN.com/caffertyfile and post a comment on my blog.

Speaking of money, are you going to take us all out to dinner later tonight?

BLITZER: Yes. Absolutely.

Are you ready?

CAFFERTY: I'm ready.

BLITZER: Where do you want to go?

CAFFERTY: The restaurant of your choice. There's a nice steakhouse here in the building.

Also, we get reaction from the House speaker, Nancy Pelosi. She sits down for a one-on-one interview with our senior political correspondent, Candy Crowley.

And Mexico shutting down tens of thousands of public venues as the swine flu death toll climbs. The country's ambassador to the United States joins us live to talk about the extraordinary measures being taken.

(COMMERCIAL BREAK)

BLITZER: A political earthquake on Capitol Hill -- veteran moderate Republican senator, Arlen Specter, announcing he's leaving the GOP, joining the Democrats -- a move that puts President Obama one vote shy of a filibuster-proof majority in the Upper House.

Let's bring in our national political correspondent, Jessica Yellin.

The reaction is coming in from all sides.

JESSICA YELLIN, CNN NATIONAL POLITICAL CORRESPONDENT: It is, Wolf. And Democrats right now are over the moon. Now, they know that Specter won't vote their way all of the time, but often is good enough. And if Al Franken becomes the senator from Minnesota, then they reach that all-important 60 vote majority.

(BEGIN VIDEOTAPE)

YELLIN (voice-over): President Obama reacting to news that the Democrats wooed Senator Specter across the lines. For the White House, it's a two-fer -- giving their party a shot in the arm.

STUART ROTHENBERG, "THE ROTHENBERG POLITICAL REPORT: It will energize them. It will embolden them. And I think Republicans will further feel that they're not only a minority, that now they're a minority that almost doesn't matter.

YELLIN: It also means Mr. Obama has one more vote on major items in his agenda -- including health care reform, energy, education and spending on the economy.

SEN. ROBERT CASEY (D), PENNSYLVANIA: President Obama's priorities this year are going to have more support than they would have otherwise.

YELLIN: Still, Senator Specter will not be a rubber stamp -- or, in senator-speak...

SEN. PATRICK LEAHY (D-VT), JUDICIARY CHAIRMAN: I think Arlen Specter is going to vote the way he will vote.

YELLIN: For example, Specter is expected to vote against the Democrats on some judicial nominations and is opposing a top Democratic issue -- card checks, which has to do with voting rules for joining unions.

SEN. ARLEN SPECTER (D), PENNSYLVANIA: I will not be an automatic 60th vote. And I would illustrate that by my position on employees choice, also known as card check. I think it is a bad bill.

YELLIN: But Specter's decision is a great deal for the White House.

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: I'll take it. I think the president is quite pleased.

(CROSSTALK)

GIBBS: That's the understatement of the day.

(END VIDEO TAPE)

YELLIN: And, Wolf, among the many Democrats who helped nudge Senator Specter along were Vice President Biden and Pennsylvania Governor Ed Rendell. After Specter voted for the stimulus, and infuriated Republicans by doing so, both men publicly teased Specter that it's time he crossed lines and joined the party. They were surprised to learn that this week he decided to do it -- Wolf.

BLITZER: It was a huge surprise.

All right. Thanks very much, Jessica.

Let's talk about this with Democratic strategist and CNN political contributor, Donna Brazile, and Republican strategist, also a CNN contributor, Ed Rollins.

How surprised were you -- Donna?

DONNA BRAZILE, CNN CONTRIBUTOR: Very surprised, Wolf. But let me just say, as many Democrats are saying today, welcome to the Democratic Party. We don't always agree with each other, but it's a very vibrant party, a healthy party. And the moderate wing has a huge voice at the table.

BLITZER: Do you think there will be a challenge on the Democratic side for him get the Democratic nomination in the next year?

BRAZILE: Well, I'm sure that there are still some Democrats who would like to challenge him because of his nonsupport of the EFCA bill -- the Employee Free Choice Act. But I also believe that the Democratic Party owes him a debt of gratitude for switching at this time and coming over when the Democrats really want to get the 60 votes.

BLITZER: So I assume you agree, he's going to be the Democratic nominee -- Ed, next year?

ED ROLLINS, REPUBLICAN STRATEGIST: And he'd better go find $50 million somewhere, because he's our number one target. People are going to come full bore. People have had to swallow Arlen Specter for a long, long time. And rather than spend money in the primary trying to beat him, which Pat Tumi might have done, we can now spend it in the general.

BLITZER: But Pennsylvania is a pretty blue state, don't you think?

ROLLINS: It's -- I think it's a swing state. I think -- I think in the midterm, you know, it's certainly a place to go compete. Arlen has some enemies on both sides of the aisle. He has a lot on our side now.

BLITZER: What does it say about the state of the Republican Party when a moderate Republican like Arlen Specter bolts?

ROLLINS: I think he is a different story. I think Arlen has never been comfortable in the -- in the party. He's -- he's had serious opposition in the past. You know, I think the reality is our party has to rebuild. And to a certain extent, we're not going to play around with the numbers now.

We're on one side, the president and his team are on the other side. They can get everything they want at this point in time and we're going to draw the line in the sand. We're not going to be invited in the door to basically be part of the negotiations.

So I think that basically puts us in a position where, you know, we become a real opposition party, both the House and the Senate.

BRAZILE: Two hundred thousand Pennsylvanians last year switched from the Republican Party to the Democratic Party because they wanted the kind of moderate voices that Arlen Specter represents. They can throw all of the money after Arlen Specter. He is a strong, principled lawmaker. They will have a hard time defeating him.

BLITZER: And how significant would the fact be that the president of the United States would go into Pennsylvania and campaign aggressively for Arlen Specter? ROLLINS: I had -- I had a president, Ron Reagan, who went and campaigned aggressively for him to get -- to get him there. I mean he's always had tough elections and my sense is he'll have a tough election this time. He may -- he may end up winning. But at the end of the day, I promise Democrats will have a -- have a lot of -- a lot of joyful days keeping Arlen happy.

BLITZER: Do you think we're going to see more of this party switching as we get closer to 2010?

BRAZILE: Well, I think that President Obama -- this is one way for him to reach out to Republicans. A lot of Republicans right now are disenchanted with their party. They believe that the right-wing of the party -- and I'm not criticizing the right-wing of their party. But they believe the...

ROLLINS: Yes.

BRAZILE: Of course not you.

(LAUGHTER)

BRAZILE: But they believe that the right-wing is out of touch with everyday ordinary Americans. And so I think this is an opportunity for the Democrats to pick up not just lawmakers, but more and more disgruntled voters.

BLITZER: Can the Republicans pick up some Democrats who might be not all that happy with the president of the United States?

ROLLINS: No. No. Historically it works when -- we changed a lot of Democrats to Republicans in the '80s. There's -- there's going to be no one switching from the Democrat to the Republican side. We're going to have to go outside of Washington.

We're going to have to do like we did after Watergate -- go out and find a Ronald Reagan who's a governor or something like that and build a movement out there and come back.

BLITZER: Give me a name.

Who is that person?

ROLLINS: Well, I -- I can't give you a name, because there's -- there's several out there. I'll throw one out. I think Mitch Daniels -- and I (INAUDIBLE)...

BLITZER: The governor of Indiana?

ROLLINS: I preface it by Mitch used to work for me. But Mitch is a first rate, classy guy from a key state. He could be a viable candidate going forward.

BLITZER: I've heard a lot of Democrats say they -- they look at the governor of Utah right now, Jon Huntsman, as a potential formidable figure emerging as a political leader for the GOP. BRAZILE: I think before they find a messenger, they need to really come up with a coherent message that will get them out of the wilderness. And you saw in the poll over the weekend that they're even deep in the wilderness with only 21 percent of the American people now identifying themselves as Republicans.

BLITZER: Quickly on the swine flu. Give me a grade.

How is the president -- how is the team doing -- the Obama administration dealing with this global...

ROLLINS: I think...

BLITZER: ...global crisis?

ROLLINS: I think they're doing very well. I mean the bottom line here is that either there's controllable or uncontrollables in politics. This is an uncontrollable. This is the ultimate test of whether you do well. And I think so far, they've done very well.

BLITZER: What do you think?

BRAZILE: They're keeping us informed and that's the most important thing right now.

ROLLINS: Right.

BLITZER: But the fact that they're not playing it full strength is not a big issue, as far as you're concerned?

BRAZILE: Well, look, I mean they are taking steps now to prepare us just in case with more vaccines coming online. I think, right now, we're just going to pray for the best.

BLITZER: How visible should the president of the United States be?

Janet Napolitano, the secretary of Homeland Security, very visible; Dr. Besser, the acting head of the CDC, very visible.

ROLLINS: I would...

BLITZER: How visible should the president be?

ROLLINS: I don't think he should be more visible than he is. I don't think we want to cause a panic until we have a real situation.

BLITZER: All right...

ROLLINS: And anytime you put the president out front, it's -- it creates a panic. And I think -- I think if it does become an epidemic, which we hope and we pray that it doesn't...

BLITZER: Right.

ROLLINS: ...then, obviously, he's got to be front and center. But up until that point...

BLITZER: What do you think?

BRAZILE: We should never exploit a situation like this. Leadership -- Secretary Napolitano is doing a great job.

Let's make sure that we know everything we need to know and prepare for the worst but, you know, hope for the best.

BLITZER: We certainly are hoping for the best. But there's a lot of concern out there.

All right, guys.

Thanks very much.

ROLLINS: Thank you.

BLITZER: We'll continue this conversation.

New deaths and more cases of swine flu in Mexico. Some are saying seal the border. I'll talk about that and more with Mexico's ambassador to the United States.

Plus, a new twist in the coming -- in the debate over cloning.

What sets these puppies apart and how could it benefit you?

(COMMERCIAL BREAK)

BLITZER: T.J. Holmes is monitoring some other important stories incoming into THE SITUATION ROOM right now -- T.J., what's going on?

HOLMES: All right. What's going on, we'll talk about earthquake survivors first. Over in Italy, they got some comfort and got a hug from the pope today. Pope Benedict XVI visited towns that were hit hard earlier this month by the 6.3 magnitude quake. The pope demanded some serious soul-searching, as he called it, from the people responsible for the building construction in that region. The quake killed 296 people and prosecutors are now investigating claims that companies illegally mixed sea sand with cement to construct those buildings.

And you've got to see this video out of Georgia today. This was happening right around us here at the CNN Center, going through Atlanta. Yes, authorities say a truck owner who had been carjacked -- truck jacked, I should say. He clung to the cab, as you can see there, of his big rig as it sped down the highway during a 50-mile chase. That's him hanging onto the back there. State police were following not too far behind. The truck did finally slow down at some point. And we saw, as well, video of that man jump off the back of the truck as it was moving. Police then surrounded that truck. They dragged the driver out and this time he got a ride to jail -- where else?

One more story here for you. Take a look at these puppies. They're different. They're special because they glow in the dark, as you see there. South Korean scientists say the genetically engineered puppies, as they are. They're cloned beagle puppies. They glow red. Now, the South Korean scientists say the glowing puppies show it's possible to insert genes with a specific trait. They say the technique could be used to implant human genes to develop cures for diseases -- so, Wolf, some good could come out of it. But right now, it's just a little weird.

BLITZER: All right. We'll see.

All right, T.J.

Thanks very much.

HOLMES: All right.

BLITZER: Mexico, as, you know is the epicenter of the swine flu outbreak. Some people are calling for the border between Mexico and the United States to be sealed.

Would that be an overreaction?

I'll speak live with Mexico's ambassador to the United States. He's standing by.

And the House speaker, Nancy Pelosi, says she's excited by Senator Arlen Specter's decision to switch to the Democratic Party -- what she says this big move will force the Republicans to do now.

And the event today that caused the first lady of the United States to reflect on her own family's rise from slavery.

Stay with us.

You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: To our viewers, you're in THE SITUATION ROOM.

Happening now, the White House says this scene and the panic it caused made President Obama furious. It's one of his planes on a low- flying photo-op over New York City yesterday morning. The president says he's ordered a full review to make sure this could never, ever happen again.

Breaking down that seismic shift in Congress -- what was Senator Arlen Specter's motivation for switching parties?

A new poll may hold some answers.

And only modest losses on Wall Street today -- the Dow closing down 8 points. Analysts say concerns about swine flu were balanced by news the Consumer Confidence Index soared to its highest level since November.

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

Health leaders in the United States are now warning there could be deaths from the fast-moving swine flu.

Here are the latest developments. The number of confirmed cases in the United States rose to 64 today, with the largest concentration here in New York City. A hundred and fifty-two deaths in Mexico are now linked to the virus. Cuba became the first country to impose a travel ban -- suspending flights to and from Mexico for 48 hours.

People in Mexico are saying don't blame them for the swine flu. Even with the number of dead and sick in that country, many there claim the killer virus didn't originate in Mexico. CNN's Ted Rowlands picks up the story.

(BEGIN VIDEOTAPE)

TED ROWLANDS, CNN CORRESPONDENT: This is the Polanco district of Mexico City. Basically it's a working class area and a lot of businesses are here. People come to work. They use the subway system coming and going. We asked them what they think about where the virus came. We got a lot of the same opinions. Not one person here believed that the virus originated in Mexico.

UNIDENTIFIED FEMALE (through translator): Somebody got it in Canada and then gave it to somebody in the United States who brought it here.

UNIDENTIFIED FEMALE (through translator): A Canadian was here visiting and got sick and sent to the hospital and that's how it started to spread.

UNIDENTIFIED MALE (through translator): It's a fever from Asia that came here to this country.

ROWLANDS: Where do you believe the virus started?

UNIDENTIFIED FEMALE: Okay, I believe it started in Oaxaca with a tourist.

ROWLANDS: From the United States?

UNIDENTIFIED FEMALE: Yes, maybe.

ROWLANDS: We've talked to people on the street here for the last few days. Nobody has told us that they think it has originated here in Mexico.

UNIDENTIFIED MALE: It's not something you create. It's something that mutates. No one wants to claim responsibility for something so bad as this. UNIDENTIFIED MALE: Whenever anything bad happens, the U.S. always blames it on Mexico. So all the drug problems, Mexico's fault. Everything is always -- there's one jalapeno which gets some old lady sick in Indiana, it's definitely Mexican. Mexico is the thing the U.S. always kicks around. When we want to kick someone around, we kick Mexico. Naturally, people here are very sensitive about it.

(END VIDEOTAPE)

BLITZER: Ted Rowlands is on the scene for us in Mexico City. Thank you very much, Ted.

Let's go to the Mexican ambassador to the United States. He's joining us now live. Arturo Sarukhan.

Mr. Ambassador, thanks for coming in.

ARTURO SARUKHAN, MEXICAN AMBASSADOR TO U.S.: It's a pleasure, Wolf.

BLITZER: How convinced are you that this swine flu outbreak originated in Mexico?

SARUKHAN: We still don't know. This is something that authorities in Mexico and authorities in the United States, CDC, are trying to figure out. We can't pinpoint the origin of the outbreak and we certainly don't know where it started and how it propagated. This is one of the issues we're very quickly trying to work with our Canadian and American partners to fine out.

BLITZER: The assumption is it started in n Mexico because most of the cases and all of the fatalities have been in Mexico. There's an area not far from Mexico City that has a large pig population.

SARUKHAN: Well, that's one of the speculations that's out there. But it still is not clear whether that was the origin. It is true that we have a very high concentration of cases in Mexico and in particular, in Mexico City. But we're working very hard to determine where this started and, more importantly, how it is being passed on.

BLITZER: Do you know why, so far, people are dying in Mexico from swine flu but they're not dying elsewhere?

SARUKHAN: No, I would certainly not know. We're trying to find out what it is. Whether it has to do with how people -- when people go to the hospital, at what stage they go to the hospital. But, no, this is something I still don't know.

BLITZER: I assume there are a lot of cases that are simply unreported in Mexico. For all the cases that are officially documented, there are probably a lot of others that people just get sick and they hope they'll get better. Is that right?

SARUKHAN: That may be the case. We first started detecting this and then able to pinpoint this was a new strain of influenza. More or less the same time the flu season was winding out in Mexico. There may have been other cases. But certainly we're trying to aggressively and transparently figure this out, ensure our communication with the United States, Canada, other countries and the world health organization is allowing us to very quickly pinpoint the origin, the contagion rates and to be able to shut it down.

BLITZER: Was the state department right yesterday in calling for a travel advisory against any nonessential travel to Mexico?

SARUKHAN: The World Health Organization has not called for a travel ban or a quarantine or the shutting down of borders. I think that when you have a disease like this, common sense should be the keystone, and I think that people who are traveling should use common sense to determine whether they need to travel or they can hold back a few days or few weeks until we can all figure out what's going on.

BLITZER: No doubt that Mexico, like so many other countries around the world, were suffering from an economic recession, major economic distress tourism, already going down because of the drug issue. But now because of this, your country is in deep financial trouble as a result of this economic strain, the result of swine flu.

SARUKHAN: I think all the world is facing a profound global recession. I think Mexico is not the exception. I must say that figures for tourist revenues in the first part of the year are more or less on par to what they were last year. And more importantly, we have not seen any significant reports of influenza along the coastal regions of Mexico. So we're waiting to see what the impact of this is.

BLITZER: One report that you're losing $57 million a day in tourism revenue right now. Have you heard about that?

SARUKHAN: I have not seen those figures, Wolf.

BLITZER: As you say if people are nervous, they're not going to go to Cancun or Acapulco. They're not going to go on vacation to Mexico right now until the swine flu crisis eases.

SARUKHAN: I think that what is important for the Mexican government is to ensure that the health of our citizens and of other citizens traveling to Mexico from other countries is taken care of, that we ensure by working with the United States and other nations that we can shut this down. This has to be our priority. And this is what we will focus on in the next days.

BLITZER: How is your supply of the masks, the antiviral medications? Are the stockpiles there or are they dwindling?

SARUKHAN: The stockpiles of the medicine are there. They are strong. Face masks at the rate they're being used are starting to dwindle, but we are already reaching out to certain countries in the world to ensure our stockpiles can be maintained.

BLITZER: What do you say to those Americans who want to really tighten up, close up the border between the U.S. and Mexico and make it so much more difficult for Mexicans to come into the United States either by land, sea or air?

SARUKHAN: Again if you look at previous experiences, Wolf, where there have been previous outbreaks of other diseases, this type of decisions don't do the job. They don't do the trick. It won't change the fact that there are already cases of influenza in the United States. That there are cases of influenza in other countries. And I don't think that the shutting of the borders at this stage, at least, will do anything to change that.

BLITZER: How is the level of cooperation between your government, the Mexican government, and the Obama administration on this issue right now?

SARUKHAN: It is excellent. We're building upon what we started doing. Canada, Mexico and the United States knew that at some point we could face this type of challenge. Since 2005, Mexico, Canada and the United States have been working to streamline protocols to exchange information, to create the mechanisms where we can very quickly react. And I think that the support we're getting from the Obama administration is top notch. I have been on the phone several times with Secretary Napolitano and John Brennan at the white house. And I think that the cooperation and exchange of information is where it needs to be.

BLITZER: What are your health experts in Mexico telling you we should expect in Mexico over the next, shall we say, two weeks?

SARUKHAN: I wish I was Sanjay Gupta to be able to answer that one, Wolf. Basically, I think the mode right now is wait and see. We're trying to ascertain whether there's a leveling off of contagion and of deaths related to the virus over the next 24, 36 hours. And based on that, I think we will be able to see some projections of how the virus either mutates or reacts in the coming days.

BLITZER: We'll be speaking shortly with Dr. Sanjay Gupta, Mr. Ambassador. I'm sure you'll be interested in his report as well. Arturo Sarukhan is the Mexican ambassador to the United States. Mr. Ambassador, I hope you'll come back.

SARUKHAN: I will, Wolf. Thank you.

BLITZER: Thank you. And good luck to everyone in Mexico.

A Republican defection, Senator Arlen Specter of Pennsylvania standing by. He's getting ready to join the Democrats. In fact, he already has. How will it play at home in Pennsylvania? What does it mean nationally? We have some new poll numbers for you.

Plus, the first lady unveils the first statue of a black woman in the U.S. capitol building. Michelle Obama honoring the abolitionist Sojourner Truth.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK) BLITZER: Let's get more on the big switch on Capitol Hill today. The decision by longtime GOP Senator Arlen Specter to become a member of the Democratic Party. He may have been motivated in part, by some political views that are unfolding right now. Our senior political analyst Bill Schneider is out with some new poll numbers watching what's going on.

SCHNEIDER: It's all about political survival. Arlen Specter was trailing a conservative challenger in next year's Pennsylvania Republican primary. Specter's prospects of survival looked much better as a Democrat. Pennsylvania Republicans have an unfavorable opinion of the man who has been their senator for nearly 30 years. But Pennsylvania Democrats like Specter, especially after he was one of only three Republicans in congress to vote for President Obama's economic stimulus plan.

SEN. ARLEN SPECTER (D), PENNSYLVANIA: I supported it because of the urgent necessity in the public interest.

SCHNEIDER: A vote that was very popular with Pennsylvania voters.

SEN. MITCH MCCONNELL (R), MINORITY LEADER: This is not a national story. This is a Pennsylvania story.

SCHNEIDER: Is it? Specter's switch raises a larger question about the survival of the Republican Party nationally. The party has suffered two successive defeats, losing congress in 2006 and the white house in 2008. Has President Obama's popularity trickled down to the Democratic Party? A bare majority of voters nationwide have a favorable opinion of the Democratic Party. That's down a bit from the rush of excitement between Election Day and Inauguration Day when positive opinion of the Democrats was at 60 percent or more. But the Republicans are still suffering negative fallout. Why? Because the party has moved too far to the right.

SEN. BOB CASEY (D), PENNSYLVANIA: The National Republican Party's answer to every proposal or initiative by President Obama is not just no but, hell, no. I think that's not a winning strategy over time.

SCHNEIDER: Republicans are seeding the center to the Democrats. Moderate Republicans hold a favorable opinion of the party.

(END VIDEOTAPE)

SCHNEIDER: Senator Specter's switch could signal an Obama realignment comparable to the Reagan realignment. When Ronald Reagan became president, moderate and conservative Republicans, particularly in the south, started switching to the Republican Party. Now in the northeast, moderate Republicans are abandoning the GOP. Senators Jim Jeffords and Lincoln Chafee became independents, and now Arlen Specter is becoming a Democrat.

BLITZER: Very dramatic move by Senator Specter. Thanks, Bill.

The House Speaker Nancy Pelosi has a lot to say about Senator Specter's decision. Our senior political correspondent Candy Crowley had a chance to meet with the speaker of the house today. I assume she was all smiles.

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: Absolutely. I mean, we went to talk about the first 100 days and certainly, she was all smiles about that. But we started off talking about Senator Specter. And she said this just makes the first 100 days all the better.

(BEGIN VIDEOTAPE)

REP. NANCY PELOSI (D) HOUSE SPEAKER: Very exciting. Very exciting for the American people because now we can get things done without explaining process. But it shows that the country is going in a new direction, and we would hope to do that in a bipartisan way. Now we'll do it with all the diversity of thinking within our very independent thinking party.

CROWLEY: But there's a problem with the independent thinking party, isn't it, because you can't really count on them all the time.

PELOSI: That's how we're different. We are a party that recognizes diversity, that builds consensus, that recognizes that our members are from all parts of the spectrum, philosophically all parts of the country, geographically many of the issues we deal with are regional. So it's pretty exciting. I have to say. And on the heels of our winning the congressional race in the past weekend in New York, having the Democrat declared the winner in a district that is 75,000 more Republicans than Democrats. There's a message here about the change the American people want.

CROWLEY: You said what it says to the American people and to the Democratic Party. What does it say about the Republican Party?

PELOSI: They are going to have to do their own self-analysis. But I do think the president is right in reaching out in a bipartisan way. We tried to do that here as well. Hopefully now they will also extend a hand of friendship so they can work together in a bipartisan way. We have very big decisions to make here about the health of the American people, the health care reform, about energy, education, the protection of our country first and foremost and our first responsibility. It's important to strive to do it and to find someone ground in a bipartisan way.

(END VIDEOTAPE)

CROWLEY: Now the speaker also talked a little bit, Wolf, about what's coming up down the line about immigration, about cap and trade, which is a way to control carbon emissions. She did admit, as they are moving forward, that some of those very Democrats who have been very supportive of President Obama in the first 100 days will begin to fall off for those regional issues she talked about. And then she said it will not just be a matter of wanting some bipartisan. They're going to need it.

BLITZER: She's right. They will need some bipartisanship. Thanks very much for that. Candy Crowley reporting.

Remember, tomorrow night, CNN's national report card, it all starts at 7:00 p.m. eastern here. We want you, our viewers, to grade the Obama administration, congress, on the work so far doing these first 100 days. Go to CNN.com. You'll be able to vote there. All happening tomorrow night.

A frontline tool that could help prevent a pandemic. Major airports in Asia use thermal imaging. We'll demonstrate how it works and show you why something you might wear can cause it to miss someone with a fever.

And why people in the United States are still traveling to Mexico despite the warnings. We're taking you to the borders.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Let's check back with Jack Cafferty for "the Cafferty File."

JACK CAFFERTY, CNN CORRESPONDENT: Nice to have you here in the city. It is a big city. The question this hour is spending less a new reality for your family?

Don in Toledo writes, "My wife and I worked and we ate out quite a bit. She lost her job so no more of that. We recently took an overnight trip for relaxation. Cheap motel, eating at discount restaurants and taking advantage of every discount available. Didn't use a single credit card. We still had fun and hope that this is a lifestyle that we can stick with."

Sandy in Arkansas writes, "The true reality for most of us is that most necessities cost more these days and yet our paycheck has not gone up. Therefore, we are not spending less, we are just getting less for what we spend. I haven't had a raise in all those four years, don't anticipate getting one. That old saying my take home pay won't take me home is beginning to ring true."

P.J. writes, "No. Responsible Americans have spent within their means for years. We don't buy just for the heck of it and don't let fads rule our lives. Material possessions don't control us and we actually have money to enjoy an occasional treat."

M.K. writes, "I am trying desperately to save each month. It is slow going. I now realize my relationship with money was not as solid as I had thought."

Stephen writes, "Spending less has become more of a mantra than a reality. Every last expense has been re-examined and re-evaluated no matter how trivial. Eating out has become a thing of the past. We are now content to buy generic brand food. The term discretionary spending now considered foul language, groceries, gas, education and hunkering down the order of the day."

Mari in Salt Lake City writes, "Nope, we have always lived within our means and budget. We do not worry. We have followed the financial rule of having 8 months of our salary in our regular savings account for a rainy day."

And Mack writes, "Welcome to the new trend. Forget losing weight or plastic surgery. It's all about who can spend the least amount of money at the grocery store."

If you didn't see your e-mail here you can go to my blog at CNN.com/CaffertyFile. Look for yours among hundreds of others. The Gallup people have found that a significant percentage the people that they interviewed say that this idea of spending less money is going to become a permanent part of their lives which has all kinds of implications.

BLITZER: Even people who have money are beginning to cut back.

CAFFERTY: Yes.

BLITZER: Just the nature of the situation.

CAFFERTY: But I mean if the country actually began at some point living within its means who knows what we could do.

BLITZER: We'll be good.

CAFFERTY: Sky would be the limit.

BLITZER: What if the government began to --

CAFFERTY: Now, that will never happen, is it?

BLITZER: Probably not.

CAFFERTY: No.

BLITZER: Jack, thank you.

President Obama said to be furious at that low-level military flight raised fears of another 9/11 in New York City. And now he's taking action. Stand-by for the details.

And the first lady honors a former slave, speaks of her own family's rise from slavery. We're going to hear from Michelle Obama in her own words.

(COMMERCIAL BREAK) BLITZER: We'll get back to our top story the swine flu crisis in just a moment. But this, first, for the first time an African- American woman is being honored with a statute inside of the U.S. capitol building and who better to unveil it than the first country's first African-American first lady. Here is Michelle Obama paying tribute to the abolitionist Sojourner Truth.

(BEGIN VIDEOTAPE)

MICHELLE OBAMA, FIRST LADY: One can only imagine what the Sojourner Truth, an outspoken, tell it like it is, kind of woman. And we all know something about that, right? And just imagine what she would have to say about this incredible gathering. Just looking down on this day, and thinking about the legacy she has left all of us because we are all here because as my husband says, time and time again, we stand on the shoulders of giants like Sojourner Truth. And just as Susan B. Anthony, Elizabeth, Katy Stanton, Lamont would be pleased to than we have a woman serving as the speaker of the House of Representatives. I hope that Sojourner Truth will be proud to see me, a descendant of slaves, serving as the first lady of the United States of America.

So I am proud to be here. I am proud to be able to stand here on this day for this dedication. And just as many young boys and girls have walked through this capitol, I see them now. And they see the bussed of suffragists and hear the stories of the struggles of woman what they had to endure for the woman's right to vote. Now, many young girls and boys like my young to daughters will come to emancipation hall and see the face of a woman who looks like them.

And all of the visitors in the U.S. capitol will hear the story of brave women who endured the greatest of humanities and dignities. They'll hear the story of Sojourner Truth who didn't allow those indignities to destroy her spirit, who fought for her own freedom and then used her powers, young people. Then she used her powers to help others.

(END VIDEOTAPE)

BLITZER: Ms. Sojourner Truth was a former slave who crusaded not only to end that practice but also for women's suffrages, suffrage rights. Her statue is now on permanent display in the new capitol visitor center in Washington.